Due to competition from cut rate vendors such as Wal-Mart and Netflix that sell or rent DVD's on the cheap, Viacom is laying the groundwork to divorce themselves from the still profitable Blockbuster. The entertainment company also owns CBS, MTV and Nickleodeon along with it's 81 plus percent share of Blockbuster.
Yes, this is a wise move it would seem. We have already seen that Netflix is putting the squeeze on Blockbuster, by taking many of their customers. Some 40 percent of Netflix clients are former Blockbuster fans. In addition, McDonalds has set their sites on the DVD rental business, where people can kill two birds with one stone on the cheap. Feed the family quickly and pick up a DVD movie for a buck. With a successful test market completion in Denver, Colorado, Blockbuster could face 30,000 new rental outlets to contend with. One handy thing about McDonalds automated kiosks is, they don't care what restaurant you return the movie to. Not to mention, McDonalds doesn't need to make money from the DVD rentals.
Source: The Detroit News
